Miami facial recognition company Kairos is suing its founder and former CEO Brian Brackeen, an outspoken proponent of Miami’s budding tech scene, accusing him of theft.
In a suit filed Oct. 10 in Miami-Dade, the company claims that Brackeen, whom the company terminated Sept. 28, used company funds to pay for personal expenses totaling at least $60,000.
“Brackeen’s actions have irreparably damaged Kairos by causing it to lose some current and potential investors’ and customers’ confidence and trust,” the company states.
The company also claims Brackeen breached his fiduciary duty and has interfered with the company’s affairs since his termination.
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Kairos places the allegation of misappropriation of company cash front and center in the suit. It says that at one point, Brackeen, who founded Kairos in 2012, “began using Uber to travel around Miami, and at least to and from work.”
The company’s CFO suggested Brackeen should purchase a car, as Uber was costing the company too much money. Brackeen declined to do so, the company says. Instead, he bought his girlfriend a car, then put the company on the hook to make the car’s payments, the company says. After Kairos ceased making payments, the girlfriend threatened to sue the company for defaulting on its obligation to pay, the company says.
Other expenses Brackeen allegedly charged to Kairos include a Soho Beach House membership for nearly $4,000, multiple stays at the W Miami for nearly $2,000, food and food deliveries in excess of $5,000, and vacation or travel authorized under false pretense to Cincinnati, New Orleans, Singapore and Colombia in an amount of at least $7,504.75.
“Brackeen did not only use the company credit card to pay for leisure travel; Brackeen essentially lived off the Kairos credit card and paid for a significant amount of expenses here in Miami,” the suit states.
In an email, Brackeen denied the allegations.
“None of it is true,” he said, adding he plans to countersue.
“Keep in mind, the valuation of the company is $120 million dollars,” Brackeen said. “I’ve raised over $13 million. The $60K thing is not only false, it’s ridiculous. I’d just write the company a check for that. You don’t fire a CEO for that.”
He called his ouster and the suit “a corporate coup” by “people who would rather steal from me & our investors than start their own company.”
“It’s disgusting,” he said. “These folks fired me (inappropriately) via voicemail. That’s the level of petty we are dealing with here. They can’t be trusted, nor anything in their lawsuit.” He said he would be sharing his own story in the coming days.
Attached in the suit is Brackeen’s termination letter, which states that in addition to misuse of corporate funds, Brackeen misled investors about revenues and fundraising. In a letter to investors seen by the Miami Herald, Kairos chairman Steve O’Hara states, “Kairos is close to out of cash.” He also says the company raised $6 million in its latest fundraising round – less than the $30 million Brackeen had publicly stated the company had planned to raise.
O’Hara declined to comment.
Kairos currently has 19 employees, 11 of whom work out of Kairos’ current office on Brickell Key. The company also recently acquired a Singapore-based facial recognition company, and has consolidated its research and development team at that location.
“Our biggest concern throughout all this has been the well-being of our team, because they are the true backbone of Kairos,” interim CEO Melissa Doval said in a statement. “Everyone has been hard at work and thanks to their talent and hard work throughout the transition... I believe the rest of the year and 2019 will be a time for rebuilding and creation in order to bring Kairos into the AI powerhouse we’ve promised in the past.”